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To: ~digs who wrote (497)	11/14/2002 1:55:13 AM
From: ~digs	Read Replies (1) of 6763

State Coalition Approves Internet Sales Tax Plan washingtonpost.com ----------- Revenue-hungry states today took the first step toward building a national framework for taxing items sold over the Internet. In a meeting in Chicago, lawmakers and tax officials from 30 states -- including Virginia and the District of Columbia - endorsed a proposal to simplify their tax laws and enter into a voluntary pact to collect online sales taxes. ------------- The voluntary program would take effect when at least 10 states representing 20 percent of the U.S. population have amended their laws to implement the program. Participating states would then be free to ask Congress to approve a mandatory, nationwide online sales tax regime. ------------ Today's vote is a welcome development for the nation's largest main street retailers, who have argued for years that the current system gives online vendors an edge over so-called "bricks-and-mortar" stores. ------------ The U.S. General Accounting Office has estimated states lose nearly $13 billion each year on untaxed Internet transactions. That figure will more than triple to $45 billion by 2006, according to a 2001 University of Tennessee study conducted for the Institute of State Studies. ------------ Internet vendors would likely bear substantial costs just in terms of the tax preparation needed to file as many as 45 separate tax returns each year, experts contacted for this story said. Under the states' plan, online sellers would be required to purchase approved software to compute the appropriate state and local taxes or to certify with the state any in-house calculation systems already in place. E-tailers could choose to outsource tax collection to a certified third-party under the states' plan. ------------- Streamlined Sales Tax Project supporters said they expect states representing a fifth of the U.S. population to pass implementing legislation by June 2003 -------------- The current legal block to online sales taxes dates back to 1992, when the U.S. Supreme Court ruled that merchants cannot be required to collect sales tax unless they have a physical location in the state where the customer is located. The court said it would be unfair to require out-of-state sellers to comply with thousands of state and local tax jurisdictions across the nation. But the high court also ruled the Congress has the authority to allow states to require remote sellers to collect taxes.

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